Coalition Government

So now it all begins to come together.  Greece and France have rejected the German austerity regimen; can the rest of Europe be far behind?  The Arab world is struggling with its soul to decide where traditional Islamic values end, and political modernism begins.  Putin wins his election and discovers that winning does not mean the end of protests.  China shows cracks in its imperturbable front as ouster of dissident party leaders and escape of human rights protesters reveal new levels of internal struggle.  In the U.S., the Congress for the fourth year in a row continues to be unable even to agree on a Budget.  And multi-national corporations are taking all sides and none, to assure future profits. The situation in Europe has been called chaotic by some observers (as could also be called the situation in the Middle East.)  And that’s an interesting way to describe it.

Chaos is an ancient Greek word (how appropriate!) that can mean either totally without order, or a chasm or abyss, or a cloud of potential creativity.    It’s what we used to describe at the office as an insurmountable opportunity.  Greece and the Middle East seem to illustrate the first definition, the whole Euro zone the second (is it about to leap into dissolution?), and possibly the whole scene the third.  For what is lacking to turn the world on its ear in a burst of creativity is an innovative way to govern though coalition, though not the kind of party coalitions common to traditional politics.

Traditional coalitions are arrangements between political parties in a country to share a majority power in the national legislature by voting cooperatively with each other.  In Greece, for example, the recent election has not gotten any party even close to a majority and they are seeking, unsuccessfully so far, to find a coalition capable of forming a majority government. But even if a coalition is formed, that won’t begin to solve the issues with Germany and the bankers.  That will require concerted action with France and the rest of Europe, which will have their own coalition issues, and in turn lead to the need for concerted action in negotiations with bankers, the IMF and Wall Street.

Some new kinds of coalitions are needed, and that will require recognition of who the actual opposition parties are.  That is not as obvious as it looks.  Germany, for example, is the usual villain named in accounts of the problems of unalloyed European austerity in recent years.  But Germany, along with China, has been one of the most prosperous countries in the world because of its exports. The rest of Europe is a major part of its export market, and unstinted austerity in southern Europe generates substantial risks for German manufacturers and the whole German economy. And so also does inability of southern European customers to pay their bills.  As I’ve noted in a previous post, the IMF has projected a growth in German GDP of only 40 percent of the growth rate of American GDP over the next 5 years.  A healthy growth regimen in Greece and France would likely boost the German economy.  The problem for Germany, as for the rest of Europe, is that German politics is controlled by its bankers, who are focused on foreclosure of southern Europe to the exclusion of all else. But of course, who would be the subsequent buyer?  And not only German bankers are in the mix.  For Goldman Sachs and other large multi-national banks played leading though shadowy roles in generating Europe’s current crises. In fact, then, the real opponents in this case are corporate bankers versus governments responsible to support the needs of all their citizens.

What is needed are coalitions, both governmental and non-governmental, that serve common interests across national boundaries.  The two major assets of multi-national corporations are their portability and immortality.  Their portability enables them to cross or minimize national boundaries with ease and to escape regulatory control by any one nation. Their immortality enables them to accumulate the vast resources that can overpower even the resistance of large sovereign states.  One Sweden-based multi-national corporation, Stora Kopparberg, was chartered in 1288, making it older than many of the over 40 countries where it operates today.  They also are expert at association, cartels, joint ventures and other forms of corporate coalition. Governments in Europe on the other hand, are still more French or Greek or British or German than they are European.  National boundaries form the limit of their visions of problems shared across Europe.  To deal with corporate portability and resources that are damaging to all nations, governments must unite in international regulatory regimens, parties must seek partners across national boundaries (a European Progressive Party?) and social action groups act in concert (an Occupy Europe?).  Creative chaos is an opportunity that should be built upon.